Borough repeals aircraft tax

PALMER — Airplane owners will get to keep $75 they would have paid in taxes after the Mat-Su Borough Assembly repealed its tax on airplanes last week.

“I’ve been involved in local politics for a long time,” said Assemblyman Darcie Salmon, who introduced the proposal to repeal the tax. “I have never seen a positive response to anything like the response to this here.”

According to borough code, the tax amounted to $75 on “single-engine aircraft, hot-air balloons and gliders, and $125 per year for aircraft with two or more engines.” The repeal passed unanimously Tuesday and goes into effect July 1.

Of the 10 people who testified regarding the repeal, most were aircraft owners and only one opposed the change.

Lucille Frey said that when the current tax was passed, the assembly at the same time tinkered with tax on automobiles. Instead of taxing a car based on its assessed value, it became a flat rate.

“It was harmful to the people who could least afford to pay this extra because if their car was older they were paying less than $70,” Frey said. “Unless you’re willing to lower the flat rate for older vehicles I have to be against (the aircraft tax repeal).”

William Bruu, an aircraft owner, said he was in favor of repealing the tax, but had one misgiving.

“I have paid my registration and tax every year since 1999,” Bruu said. “What’s going to happen to the scofflaws? What’s going to happen to all those people who have not paid that tax since 1999?”

He suggested fitting airplanes with “boots” similar to the kind cities affix to the wheels of cars with unpaid parking tickets to encourage payment of back taxes. In any case, Bruu said he opposed letting those scofflaws off the hook.

“If that’s the case, I’ll be at the window in the morning looking for a refund on my taxes,” Bruu said.

Jill Parson said she talked with the assessment department and offered some of what she’d found. She said the tax brought in $25,000 to $30,000 per year when factoring out the money the borough spends to collect it. Streamlining that process brought that number up to around $61,000, according to a borough estimate.

“I still think that’s an optimistic figure,” Parson said.

She noted that more than 30 percent of owners don’t pay the tax and unpaid back taxes total $72,000.

She spoke in favor of repeal, pointing out that the borough used to tax recreational vehicles like snowmachines and boats. The borough gave up that tax, but kept building boat launches and trails while doing nothing to provide services for aircraft owners.

“Repealing this tax is a step in the right direction,” she said.

Assemblyman Steve Colligan agreed that the tax should go, but asked borough manager John Moosey to come back at a future meeting with a report on what the options are to make the scofflaws pay. Moosey said he could do that.

“Something I will check into, and it might not cost us anything, is we could turn it over to a collection agency and they might be sorry they didn’t pay.” Moosey told the assembly.

Contact reporter Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.